Los Gatos company Netflix is close to launching a movie download service. This would broaden its rental business beyond its current DVDs-by-mail, and provide a useful on-demand Internet movie rental service that would be paired with a Netflix-provided television set-top box. The move should allow Netflix to compete with cable video-on-demand services.

"We have said we're committed to testing a product this year and we expect the test to be of a very modest nature," said Netflix spokesman Ken Ross.